When you’re a small business owner it’s easy to get overwhelmed by details like accounting, but keeping your financials in order is critical. Staying ahead of your financial details will help your business thrive in the long run. Understanding the basics, even very early on, will help prime you for a successful future. With that in mind, this week we’re sharing the first in a two part series of ten tips to keep your business accounting running smoothly.
Keep Separate Personal And Business Accounts
When you’re first starting your business it can be tricky to keep your personal and business accounts separate, especially if you’re working on a small profit margin. However, starting with separate accounts is critical as it allows you to have an easy organizational foundation. In short, business expenses should always be paid for with a business account. Not only does this help you keep better track of what you’re spending, but it makes it easier to log these expenses when it comes to tax season.
Track Every Expense
You’d be surprised how much you spend on your business in the early years. From marketing materials, office supplies, and more, these expenses add up quickly. Not only do you need to keep track of your business expenses to help you be sure that you’re not spending more than you’re bringing in, but you need to be able to deduct these expenses from your taxes. Using a business account card to pay for these items will help you keep a record, otherwise, be sure to keep receipts and you might also try accounting software.
Record Income Accurately
If you’re getting income from a wide range of sources – like loans, grants, and pay, you may find that these are all factors that are difficult to keep track of. If you don’t keep track of your income, you may find that you underpaid on your taxes and get yourself into a heap of trouble.
Consider Hiring A Professional
Once you begin to get the hang of your business accounting you may be able to manage everything on your own. But when you first start out, having a professional to help you can be quite useful. A professional small business accountant can help you find all of the potential tax deductions as well as help you learn what you need to work on and what regulations you should be following.
Automate Your Process With Accounting Software
If you’re looking for an easy way to keep track of your spending and more, using accounting software can help significantly. There are a variety of programs you can choose from; Quickbooks is a great and cost-effective option. Most software help your to keep complete track of your income and expenses and help you calculate expected tax payments.
trust the professionals at the harding group
Unlike other accounting firms, The Harding Group, located in Annapolis, MD, will never charge you for emails or phone calls and will strive for open communication with our clients. Whether you are interested in business advising, tax preparation, bookkeeping and accounting, payroll services, Training + support for QuickBooks, or retirement planning, we have the expertise and years of experience to help. We serve clients in Annapolis, Anne Arundel County, Baltimore, Severna Park, and Columbia. If you are ready to take the stress out of taxes, contact us online or give us a call at (410) 573-9991 for a free consultation. For more tax tips, follow us on Facebook, Twitter, YouTube, and LinkedIn.